DCA room price takes another step up

Selling free milk on the spot market is easy. With the current raw milk prices and the yield prices on the spot market, the willingness to sell is high. Processors and traders report this. There are also plenty of buyers. The fat contents in the milk are disappointing, which means that extra liters are needed to produce butter and cream. In addition, the milk supply in the Netherlands is decreasing somewhat. Compared to last week, the price of raw milk in the Netherlands is one euro higher at 38 euros per 100 kilos.

In the north of Germany, raw milk is traded for 36,50 euros per 100 kilos. This is an increase of 1,50 euros. The south of Germany benefits from buyers from Italy and also increases by 1,50 euros to 37,50 euros per 100 kilos. In Germany, the milk supply is fairly stable from week to week, but more than 2,6 percent below the level of last year.  

Cheese price slightly up
The cheese price in Germany benefits from a tight supply, which is accompanied by good demand. The available offer is almost completely sold in advance. Free cheese is hardly available. The price for Gouda 45 in Germany rose at the top this week by 7,50 euros to 322,50 euros per 100 kilos. The cheese price is expected to rise further in the short term.

There are rumors in the market that cheesemakers are trying to prop up the cheese price by producing less in view of the traditional summer dip. As a result, cheese makers would sell extra milk on the spot market. Especially because with the current bargain prices and the cry for fat it is interesting to sell free milk.  

Fat further up
The good demand for fat seems to be endless. The DCA cream price will increase this week by 250 euros to 6.750 euros per ton. For processors, with a shortage of product, the overheated cream and butter prices are no fun. The price agreements with the retail sector are often based on lower levels. However, the delivery obligations 'forces' processors to deliver and as a result they still have to go to the buyer's front.

Historically, the cream price has reached a turning point in week 24 (see chart). The expectation is that sentiment in fat will pick up further in the short term. Whether prices continue to rise during the summer depends on the weather. High temperatures and nice weather will probably further increase the demand for cream and put a brake on the milk supply. A cool summer is likely to flatten prices. 

Skimmed milk concentrate stable
The demand for milk powders and whey is disappointing. Buyers are waiting to see what's to come. One reason for this is a stronger euro, which weakens the European export position and the intervention stocks hanging above the market. The price of skimmed milk concentrate has a tame demand and remains at 1.550 euros per tonne.